Cuba Reports 16 Percent Online In Some Capacity


About 16 percent of Cubans are online in some capacity with access to email, the island’s intranet or the worldwide Web, a government agency says.

Cuba’s National Statistics Office said in a report posted online this week that nearly 1.8 million of the country’s 11.2 million residents used some kind of “Internet service” in 2010, a 12 percent increase from 1.6 million the previous year.

The report shows a generally steady increase since 2005.

The U.S. trade embargo has long kept Cuba from connecting to nearby undersea fiber-optic cables, forcing the island to rely on slow, expensive satellite service.

Cuba currently has the second-worst connectivity rates on the planet, according to a report by Akamai Technologies Inc. But a $70 million undersea cable laid with Venezuelan help arrived this year and could come online as early as this month.

The new usage figure is separate from a survey last year by the same office that found only 2.9 percent of Cubans reported having access to the Internet, mostly through schools and workplaces.

The previous survey likely suffered from underreporting of access to black market dial-up accounts. It also was apparently more narrowly focused on direct access to the Web.

The island’s intranet is a limited but more widely available online service in which people can surf local sites and open email accounts to send and receive correspondence, including to and from other countries.

Outside experts put the real number of Cubans with access to the larger worldwide Web at about 5 percent to 10 percent.

Cuba treats its limited bandwidth as a precious resource and gives priority to usage deemed to have social merit, such as at universities. Scarce home dial-up accounts are expensive and not available to most Cubans.

The Statistics Office’s new report also cited a boom in cellphone usage since President Raul Castro loosened restrictions in 2008. While mobile users numbered just 200,000 in 2007, just over 1 million were registered by last year, it said.

Cuba’s Deepwater Oil Exploration Could Be a Game Changer See full article from DailyFinance:

People who follow the oil industry are closing watching a pair of news items, both involving drilling operations in the Gulf of Mexico.

Earlier this week, the Obama administration said Noble Energy (NBL) could restart drilling operations at its Santiago well in the Gulf. The announcement will make Noble the first company to resume drilling in the region since last April’s BP (BP) Deepwater Horizon disaster — and the first since the moratorium on deepwater drilling in the Gulf was lifted last October.

The other bit of news is that a semi-submersible oil rig, originally due to arrive in Cuban waters this month, will reportedly be delayed until late summer.

Working Around U.S. Trade Embargo

The rig is a multinational project: owned by an Italian oil service group, constructed by a Chinese firm and funded by a consortium led by the Spanish energy company Repsol (REP). The delay is being blamed on technical problems — but “part of the delays were originally that the [rig’s] works were going to have more than 10% of U.S. technology, which is not acceptable to the U.S.,” says Jonathan Benjamin-Alvarado, political science professor at the University of Nebraska at Omaha.

That 10% figure is a part of the U.S. trade embargo against Cuba, now in its sixth decade. But the possibility of a good-size oil find off the Cuban coast could be a major game-changer for both Havana and Washington.

A 2004 assessment by the U.S. Geological Survey reported that about 4.6 billion barrels of oil — as well as substantial deposits of natural gas — might lie trapped in the sediment just north of Cuba.

Some preliminary explorations of the site have shown promise, but the oil deposit is hardly a sure thing — especially since it’s in water even deeper than the BP Deepwater Horizon site. But given present concerns over oil supplies, “the idea is to eventually export [oil] in the area or for Cuban consumption,” says Arturo Lopez-Levy, a former political analyst for the Cuban government and now a research associate at the University of Denver.

Transitioning From Oil Importer to Exporter

“It could create a significant change in Cuba’s economic wherewithal,” says Benjamin-Alvarado, who recently co-authored a book on Cuba’s energy sector. He notes Cuba currently produces about 90,000 barrels of oil daily, or about half of its overall needs — with the rest being imported from Venezuela. But with the possibility of Cuba transitioning from an oil importer to a modest exporter, there’s been a dramatic increase in foreign direct investment in Cuba in recent years — as international companies invest in the country’s oil production infrastructure.

“About 88% of all the oil reserves in the world are already spoken for,” Benjamin-Alvarado says. “Only 11% are open and available for purchase by the international oil companies.” With that in mind, he says, “oil would solidify Castro’s effort to remain viable with the Cuban people, to satisfy their material needs. The Cuban people would take the trade-off. But over the course of 10 to 15 years, that may change.”

There are also some practical concerns about possibly having Cuban oil wells operating less than 90 miles from the Florida coast. A recent report by advocates for more U.S. engagement with Cuba suggests the U.S. government should start direct talks with Havana over energy and environmental issues — to prevent any future Deepwater Horizon-like spills in the Gulf.

That suggestion is getting a lot of push-back from anti-Castro groups in Florida, as well as state lawmakers. But according to the report, by the Center for Democracy in the Americas, the current trade embargo “restricts Cuba’s access to knowledge and associations that would help it plan for or react to a spill. The embargo prevents meaningful participation by U.S. private sector firms in planning for reaction, containment or remediation efforts.”

“The extent to which the U.S. can get on the stick and put forth a working agreement on environmental drilling will be very important, to be able to monitor very closely what the Cubans will be doing,” says Benjamin-Alvarado. “This won’t solve our energy problem, but it gives the U.S. an opportunity to have an imprint in the direction of the energy developments that are presently at play in Cuba.”

Arrival of Cuba offshore oil rig delayed again

HAVANA, Feb 22 (Reuters) – Delivery of a Chinese-built drilling rig that will open the first full-scale exploration for oil in Cuban waters looks unlikely until at least August in the latest delay to beset the project, sources said this week.

They said an inspection of the newly-built, high-tech rig had been ordered to make sure it was in good shape after taking on water in transit from the Chinese shipyard where it was built to Singapore for completion in October.

The rig — the Scarabeo 9, owned by Italian oil service firm Saipem SPLM.SI — had been expected to arrive in Cuban waters in late June or early July after several earlier delays postponed its original delivery date of September 2009.

If the inspection turns up problems that need repair, the latest delay could stretch beyond August, sources said.

The water problem was not considered a major issue, but an inspection was ordered to assure the rig’s overall quality, they said.

Once the rig gets to Cuba, it will be used by a consortium led by Spanish oil company Repsol YPF (REP.MC: Quote, Profile, Research, Stock Buzz) to drill one or two exploratory wells, then passed on to other oil companies for exploration in drilling leases they hold in Cuba’s part of the Gulf of Mexico.

Repsol drilled the only offshore well in Cuba in 2004 and found oil, but said it was “non-commercial.”

It has long planned to drill another well, but is widely believed to have had difficulty finding a rig that does not violate limits on use of U.S.-developed technology set by the 49-year-old U.S. trade embargo against Cuba.

Cuba, which depends on its socialist ally Venezuela for much of its oil, has said it may have 20 billion barrels or more of oil in its untapped oil fields.

The U.S. Geological Survey has estimated a more modest 4.6 billion barrels and 10 trillion feet of gas.

The Scarabeo 9 is a dynamic positioning, semi-submersible rig, meaning it floats partially submerged in the ocean and is kept in place by thrusters built into the platform.

It will be drilling in more than 5,000 feet (1,524 meters) of water, but is capable of working in depths of 12,000 feet (3,600 meters).

An August arrival would bring Scarabeo 9 to Cuba at the height of hurricane season, but the rig is built to withstand winds up to 115 miles per hour (185 km) and waves up to 88 feet (26.8 meters).

The prospect of offshore oil exploration by Cuba has prompted proposed legislation in the U.S. Congress that could penalize companies operating in the communist-led country or require them to prove they can adequately respond to an accident like last summer’s BP blowout in the U.S. Gulf of Mexico.

Cuba is just 90 miles (145 km) from Florida, but U.S. oil companies cannot operate there because of the U.S. embargo.

Traffic jams unlikely on Cuban data highway

HAVANA (Reuters) – A Venezuelan fiber optic cable should plug Cuba into high-speed Internet within months, but it may not immediately bring an explosion in connectivity to inhabitants of the communist-ruled Caribbean island.

Virtual highways in Cuba, known for its 1950s autos and low car ownership, are also dated and the small number of individuals logged on makes it one of Latin America’s least wired nations.

This weekend, a unit of the French company Alcatel-Lucent is due to start laying a 1,000-mile, $70 million submarine fiber optic cable from Venezuela, and it is due to reach Cuba’s southeast coast in February.

Havana says the connection should come online in June, but Cuban officials warn that technological and financial constraints will still not allow them to grant massive public access to the Internet.

“Deploying connectivity is not something you do overnight because it costs a lot of money and you need other investments,” Deputy Communications Minister Ramon Linares recently told the local media, in apparent reference to servers, routers and other network gear.

The limitations on Web usage have become a new front in Cuba’s long-running conflict with the United States, which, along with human rights groups, says tight Cuban regulations on Web access restrict citizens’ freedoms.

In turn, President Raul Castro’s government says the five decades under a U.S. trade embargo have blocked Cuba off from technology and mean it cannot yet afford to expand full Web linkups much beyond workplaces, education sites and hotels.

Socialist allies Cuba and Venezuela are united by their opposition to U.S. power. They see the fiber optic line, which also extends to Jamaica, as a way of emphasizing independence from Washington.

Cuba plans to use the 640 gigabit-per-second link, which is 3,000 times faster than the current system and financed by oil-rich Venezuela, to improve already existing access points such as those at information technology clubs, post offices and research centers.

Cuba reported 1.6 million Internet users in 2009, or 14.2 per 100 inhabitants, one of the lowest ratios in the hemisphere according to the International Telecommunication Union.

Like most of those users, the 40 people leaning over computers in a fluorescent-lit national post office in downtown Havana only have access to an intranet of government-approved sites and email services.

“There is not Internet here. Just email. You should go to a hotel,” said the supervisor while dozens more waited outside to check emails at $1.50 an hour. Full Internet for an hour at a four-star hotel costs $10, half an average monthly wage.

Cuba blames such high fees on the U.S. embargo which it says has for decades barred the island from hooking up to commercial fiber optics cables crisscrossing the Caribbean. For decades Cuba had no alternative but to route all communications via a costly and slow satellite link.


Soon after taking office in 2009, U.S. President Barack Obama authorized U.S. telecom companies to take steps to connect Cuba to the Internet via fiber optics, arguing that increased information flows would better support U.S. goals of promoting democratic change in the country.

Experts say the regulations are ambiguous, and it is not clear whether Cuba would now be allowed to use existing fiber optics links passing close to its coast.

Little progress has been reported so far by U.S. telecom companies as a result of the 2009 measures.

A small Miami-based company called TeleCuba says it has been granted a license by the U.S. Treasury Department for a project to lay a cable to the island.

Many U.S. companies are nervous about dealings with Cuba, which nationalized all private enterprise in the 1960s and is only slowly opening up a limited private sector.

“Foreign investors are still kind of shy about investing in Cuba because of the freezes in assets and the fact they’re dealing with a opaque regime,” said Heather Berkman of political risk analysts Eurasia Group.

Cuba has largely ignored Obama’s telecom advances and insisted in seeking more Internet access through its friend Venezuela, more than 10 times more distant from its coast than the United States.

The Venezuelan cable, dubbed as “strategic” by both governments and first planned several years ago, should reach Cuba by February 8.

For Cuba, it means not only better access to the Internet but a much greater capacity for simultaneous long-distance calls.

Cuba’s arrival into the broadband-era comes as Castro introduces economic reforms aiming at modernizing the Cuba’s socialist system and allowing more small private businesses.

“The government will have to decide what it will use this greater bandwidth for,” said Sarah Stephens of the Center for Democracy in the Americas, a Washington-based group promoting better relations between the two countries.

“My hope is that it will enable more and more Cubans to take advantage of the benefits of this technology and it should be a helpful addition to the private sector activities that the government is trying to promote,” she added.

Cuba trades doctors for dollars

HAVANA, Cuba — “$100 a barrel oil in sight,” read a recent headline in Granma, Cuba’s communist party newspaper, and not long ago, such news would likely have been followed by hand-wringing admonitions to conserve electricity or brace for transportation cuts and rolling blackouts.

Not anymore.Raul and Chavez

In today’s Cuba, climbing oil prices are channeling much-needed cash into government accounts, even though the island is years away from commercially developing its own offshore reserves or becoming a significant energy exporter.

Instead, Cuba is turning a tidy profit on other nations’ crude.

Over the past decade, in a feat of political and diplomatic ingenuity, Cuba’s leaders have transformed the country from a place hurt by high oil prices into one that rides their rise straight to the bank. Through service agreements that send Cuban doctors, nurses and other skilled professionals to energy giants like Venezuela, Angola and Algeria, the Cuban government is compensated on a sliding scale pegged to the price of oil.

The exact terms of those service contracts have not been made public, but the basic formula is that when energy prices go up, Cuba earns more. Last year, the island accumulated a $3.9 billion trade surplus, and services — such as health care — accounted for $9.4 billion out of $13.6 billion in total export revenue, according to the government’s National Statistics Office. Those earnings now dwarf Cuba’s traditional export commodities, such as sugar and nickel.

The added revenue is helping to ease the cash shortage that forced the Castro government to freeze accounts of foreign businesses operating in the country and defer payments on its estimated $20 billion in foreign debt. It has also provided a cushion to Cuban authorities at a time of economic tumult, as 500,000 state workers — 10 percent of the island’s workforce — are due to be laid off or reassigned in the coming months.

Analysts who track Cuba’s energy sector said the country’s increasingly lucrative service agreements are “a game changer.”

“Any exponential rise in oil prices will continue to increase export revenues,” said Jonathan Benjamin-Alvaro, a Cuba energy expert at the University of Nebraska at Omaha.

During the leanest years of the so-called Special Period, the post-Soviet economic collapse that gripped Cuba in the 1990s, frequent blackouts left Cubans simmering in their cramped apartments. The island had imported most of its fuel from the Soviet Union, and with the oil spigot shut off, Cuba’s power plants and transportation networks sputtered.

Today power outages are rare. And with help from foreign companies, Cuba now produces roughly 50,000 barrels per day of domestic crude to run its power plants. The island receives some 100,000 barrels from Venezuela as well, some of which is processed on the island and re-exported to other countries in the region through the Petrocaribe agreement.

Cuba’s most profitable service agreement continues to be with top ally Venezuela, where about 40,000 Cuban professionals are running health clinics, training athletes and working inside the Chavez government. While Cuban doctors and social workers have helped shore up political support for Chavez among Venezuela’s poor, Venezuelan hydrocarbons have helped pull the Castro government back from the brink of financial ruin.

The service arrangements have strained Cuban families and the island’s own health system, but Cuban workers typically welcome the chance to go abroad, even to faraway places like Qatar or Angola, since they can earn far more than the $20-a-month average salary they would get at home.

The island’s economic fortunes will be even more entwined with world energy prices in the coming years, as Cuba has signed more than a dozen deals with foreign companies to develop its offshore reserves. A sophisticated Chinese-built deepwater drilling rig is due to arrive into Cuban waters this summer, where a foreign consortium led by Spanish energy giant Repsol will try to tap undersea deposits that geologists believe hold billions of barrels of oil.

A large discovery will accelerate Cuba’s transformation from fuel-deficient importer to significant regional energy player.

The Venezuelan government has also invested more than $6 billion to upgrade Cuba’s Cienfuegos refinery, turning the southern port city into one of the region’s largest petrochemical centers. A similar expansion is also underway along Cuba’s north coast in Matanzas, and the two projects will more than double the island’s refining capacity.

Even with those projects years away from completion, economist Ricardo Torres said there’s no longer a sense of alarm in Cuba now when oil prices increase. But he cautioned that it’s difficult to calculate the exact benefit to Cuba, because the terms of its service contracts with foreign oil producers like Venezuela have never been disclosed.

There are other risks as well, he noted. “Those agreements were negotiated based on strong ties with those countries. But if you think of a situation in which one of those governments changes, Cuba will have to negotiate a new agreement. So it’s still vulnerable to political developments in those countries.”

Key political risks to watch in Cuba

HAVANA, Dec 2 (Reuters) – The success or failure of Cuba’s economic reforms will be the key issue to watch in the next year as the government moves to strengthen the economy and ensure survival of the island’s communist system once the current aging leadership is gone.

The cash-strapped government is looking for ways to cut spending while increasing income, and could get long-term help if offshore oil exploration slated to begin in 2011 is successful.

All this occurs against a backdrop of only slightly tempered hostility with the United States, including an ongoing dispute over a U.S. contractor held by the Cubans on suspicion of spying.


President Raul Castro has taken aim at Cuba’s chronic economic problems with plans to slash 500,000 jobs from state payrolls by March while expanding the private sector and encouraging less reliance on the state.

About 200,000 of those jobs are expected to shift over to employee-run cooperatives that will be created at businesses currently operated by the state. The government also has begun issuing 250,000 new licenses for self employment and for the first time, the self-employed will be able to hire workers. So far, 30,000 licenses have been granted.

Self employment was first allowed in communist Cuba during the economic crisis that followed the collapse of the Soviet Union, the island’s main ally, in 1991. There were 143,000 licensed self-employed in 2009, and many more illegal ones.

The government’s bet is that it can create enough jobs quickly enough to absorb the laid-off government workers, most of whom it says were not in productive positions. After the first 500,000 jobs are cut, it plans to slash another 500,000 in the next few years, likely leading to more private sector expansion.

Castro announced the ruling Communist Party would hold in April its first Congress since 1997 to ratify the changes, many of which are already in action. Before the Congress, Cubans are to provide input at forums across Cuba.

The reforms are the biggest since Raul Castro succeeded brother Fidel Castro as president in 2008, and come with many questions.

Among them are whether the cumbersome government bureaucracy can move quickly to implement the plan and whether the new entrepreneurs will be too handicapped by regulations, taxes and lack of credit to succeed.

Also, do the planned job cuts present the danger of many people ending up without work and if so, what will the consequences be in a socialist country where people basically have been guaranteed employment for decades?

But the key question is whether the reforms will accomplish what Castro wants — more productivity, a stronger economy and, ultimately, the survival of communism, installed after his brother took power in a 1959 revolution. He has said maintaining the system is key to protecting national sovereignty.

Other reforms have been made, particularly in agriculture, with the same goal in mind. Castro, trying to increase output and reduce dependence on budget-draining food imports, has leased fallow lands to private farmers and taken other steps, but food production was down 7.5 percent in the first half of this year, as farmers complain that they are still too stifled by the state.

What to watch:

— How quickly the government moves to implement reforms.

— The numbers and performance of the newly self employed.

— The effects of government layoffs.

— Agricultural production.


Cuba, hit hard by hurricanes in 2008 and by the global financial crisis, has been so short of hard currency that it stopped paying most of its bills and froze Cuban bank accounts of many foreign businesses two years ago. The situation has eased, but is not yet resolved.

To avoid future cash shortages, Castro has cut spending and sought more income for the state, which controls 85 percent of Cuba’s economy. He has slashed imports by 30 percent.

Cuba is hoping to collect taxes from the newly self-employed and boost revenues from old standbys like nickel exports and tourism, two of its top hard currency earners.

The government has said it will allow construction of golf course developments, with the goal of attracting wealthier tourists.  The courses will be a small piece of the tourist industry in Cuba, but, given golf’s image as the leisure sport of the rich, a larger symbol of how far Cuba is prepared to go to improve its economy.

The government also hopes to one day get more American tourists, should the U.S. ease or eliminate the ban on most travel to Cuba under its 48-year-old trade embargo against the island. Republican gains in the U.S. Congress in the Nov. 2 mid-term congressional elections make changes less likely.

In a potentially game-changing development, a consortium led by Spanish oil firm Repsol YPF is expected to drill an exploratory well in Cuba’s part of the Gulf of Mexico in 2011. It previously drilled an offshore well in 2004, but said it did not find oil in commercially viable quantities.

The drilling rig to be used, which has been under construction in China, will be passed on to other companies such as Malaysia’s state-owned Petronas and a unit of India’s ONGC  to explore in blocks they have leased in Cuban waters.

The U.S. Geological Survey has estimated Cuba has about 5 billion barrels of oil offshore, but Cuba says it may have 20 billion barrels. Cuba currently depends on imports from its oil-rich socialist ally Venezuela.

Russia’s state oil company Zarubezhneft has said it plans to begin exploration next year in two blocks adjacent to Cuba’s coast.  A unit of China National Petroleum Corp. is set to begin a $6 billion upgrade of Cuba’s Cienfuegos refinery, with financing mostly by China’s Eximbank, backed by Venezuelan oil.

What to watch:

— Possible U.S. moves to ease its ban on travel to Cuba.

— Movement of nickel prices, start of golf course projects.

— Repsol’s second deep water exploratory well in Cuba.

— China’s growing presence in Cuba energy sector


Cuba’s relations with the United States have dominated events on the island for more than a century. During the last five decades of open hostility, the United States has tried to unseat the Castro brothers through subversion, assassination, coercion and a half-baked invasion. The long-standing trade embargo meant to topple the Castros through economic strangulation remains in place despite its lack of success. Cuba has used it to gain international support by casting itself as David versus an overweening Goliath, and at home as a scapegoat for its economic problems.

Despite modest changes at the beginning U.S. President Barack Obama’s administration, U.S.-Cuba relations have thawed only slightly and near-term prospects for improvement look dim due to Cuba’s detention of U.S. aid contractor Alan Gross.

Gross has been held since Dec. 3, 2009 on suspicion of espionage and providing illegal satellite communications equipment to government opponents, but has not yet been officially charged with a crime. The United States says he was only helping Jewish groups set up Internet access, but Cuba is suspicious because he was working for a U.S. federally-funded program seeking to promote political change on the island.

The U.S. government says it will take no major initiatives to improve relations with Cuba as long as Gross is held. Cuba may want to hold him until it gets something in exchange, such as the return of five Cuban agents imprisoned in the U.S. or an end to the programs like the one that sent Gross to Cuba.

The Cuban government is in the process of releasing political prisoners and sending them to Spain to resolve one of its biggest problems with the international community and to get its opponents out of the country.

While U.S. reaction has been guarded, the 27-nation European Union has instructed its foreign affairs chief to explore improved relations with Cuba.

Meanwhile, Cuba has steadily built relations with other key countries, among them China, Brazil, Russia and Spain. It has a special relationship with top trading partner Venezuela, whose President Hugo Chavez is close to Fidel Castro and agreed in November to extend economic cooperation another 10 years.

What to watch:

— Fate of Alan Gross.

— Continued release of political prisoners.

— U.S. and EU reaction to Cuban reforms.

Cuba deal boosts China’s Latin American oil plans

HAVANA (Reuters) – China is taking another great leap forward in its Latin American energy plans, raising Cuba’s energy importance in the process, with a deal to lead a $6 billion refinery expansion project on the communist island, experts said this week.

The project, to be funded mostly by China’s Eximbank, is the latest of several significant moves in the region for the Asian power as it continues to expand its global influence.

For Cuba, the refurbishing of its antiquated refinery in the coastal city of Cienfuegos will provide an outlet for oil it hopes to tap soon in the Gulf of Mexico, while also laying the groundwork for the island to possibly become a key oil transshipment point for the Caribbean basin.

A unit of state-owned China National Petroleum Corp expects to begin work in early 2011 on the project that will more than double the refinery’s capacity to 150,000 barrels daily and include construction of a liquefied natural gas terminal.

Venezuela, Cuba’s closest ally, will provide financial guarantees in the form of oil, a pattern followed by Beijing in other deals for energy in Latin America.

In the past two years, China has financed projects and formed joint ventures in Venezuela, Brazil and Ecuador which are expected to bring it at least 500,000 barrels of crude oil per day.

It has leased a 5 million barrel storage facility on the Caribbean island of St. Eustatius and reportedly talked with San Antonio, Texas-based refining giant Valero Energy Corp. about buying its refinery on the island of Aruba.

The oil marriage of China with Latin America is one made in energy heaven, said analyst RoseAnne Franco at energy and mining consulting firm Wood Mackenzie in Houston.

“The regions are clearly of complementary interest. China is looking for energy security while Latin America is eager for new consumer capital markets,” she said. “There is a good foundation there for the relationship.”


The Cienfuegos project is part of larger modernization of Cuba’s energy infrastructure. Brazil is financing the refurbishing and expansion of the port at Mariel, which will be the logistical platform for offshore oil operations in the Gulf of Mexico set to begin next year.

Venezuela, Cuba’s principal ally and top trading partner, is refurbishing a tanker port at Matanzas and rehabilitating a cross-country pipeline to the Cienfuegos refinery. It has also committed to constructing a 150,000 barrel per day refinery at Matanzas, which is about 60 miles east of Havana.

The expectation that Cuba will find significant offshore oil reserves is driving much of the work.

Several companies are planning to sink exploratory wells off Cuba’s northern coast starting next year.

The U.S. Geological Survey has estimated Cuba has about 5 billion barrels of oil and 10 trillion cubic feet of natural gas offshore, but Cuba says it could have at least 20 billion barrels of oil.

The other, larger piece of the puzzle is the expansion of the Panama Canal, which is supposed to be finished by 2014 and will allow bigger oil tankers to use the waterway linking the Pacific and Atlantic oceans.

Cuba is well positioned to serve as both a refining center and oil transshipment point for the newly expanded canal, said Jonathan Benjamin-Alvarado, a Cuban oil expert at the University of Nebraska in Omaha.

“Cuba doesn’t solve anybody’s energy issues, but it expands the opportunities of the global markets to have Cuba as another point of transshipment or hub for oil services and activities,” he said.

“There is a need for expansion and diversification of both refining and storage capacity in the region, and Cuba fits perfectly,” he said.

Should normal relations with the United States ever be restored, Cuba, just 90 miles from Florida, would be well positioned to serve the U.S. market, said Jorge Pinon, an oil expert at Florida International University in Miami.

Russia’s Gazprom plunges into Cuba’s offshore oil business

Havana, Cuba (CNN) — Russian energy firm Gazprom has joined a growing list of foreign companies searching for oil off Cuba’s coast.

Offshore Oil platform

Gazprom Neft, the oil arm of Gazprom, announced in a news release that it had bought a 30 percent stake in four offshore oil exploration blocks from Malaysia’s state-owned oil company Petronas. No financial details were provided.

The Cuban government says it has up to 20 billion barrels of oil in its portion of the oil-rich Gulf of Mexico, but the U.S. Geological Survey has estimated a smaller 4.6 billion barrels.

Cuba has divided its share of the Gulf into 59 blocks and foreign oil companies have leased 21 of them.

In the wake of this year’s BP Gulf oil spill, some in Florida are worried about Cuba drilling so close to home. Some of the blocs are about 50 miles off the coast of Key West.

Petronas leased its four blocks in 2007. Under the agreement, the lease can be extended through 2037 if oil is found and until 2042 if gas is found.

According to analysts and oil experts who have visited Cuba, the country aims to drill seven exploration wells by 2014.

Cuba currently produces about 60,000 barrels of oil per day from onshore wells. It imports another 115,000 bpd from Venezuela on favorable terms.

Chavez: New Cuba-Venezuela Relations Model Created

CARACAS – President Hugo Chavez said on Sunday that Venezuela and Cuba have created a new model of relations between the two countries and peoples, referring to the 10th anniversary of the Integral Cooperation Agreement.

“On November 8, we celebrated very highly in Havana that important October 30, 2000, in which Commander Fidel Castro and I signed the agreement,” said the Venezuelan president in his Sunday space Las Lineas de Chavez (Chavez”s lines) called íSoldado Bolivariano! (Bolivarian Soldier).

“It is easy to say, but you have to see the several obstacles to overcome for making reality the total of benefits our peoples are currently having: benefits that today more than ever deserve the strengthening of the Agreement for moving another 10 years towards the consolidation of our Revolutions,” noted Chavez.

According to the head of State, Cuba and Venezuela have each one their own characteristics, views, and different goals, but with an important powerful root from which the two republics receive the nutrient vitality.

“I am referring to Simon Bolivar and Jose Marti, the same feeling, Our American and Humanity-Homeland feeling: that is the legacy from which Commander Fidel Castro is a living incarnation.”

That agreement was the base of ALBA. Cuba and Venezuela have drawn up a joint course which goes beyond integration, in order to fully retake the historical flag that was left by our Liberators: unity, added Chavez.

Fiber-optic cable linking Cuba to Venezuela, Jamaica to come online in 2011

Havana, Oct 9, 2010 (EFE via COMTEX) — A $70 million undersea fiber-optic cable that will link Cuba with Venezuela and Jamaica is due to start operating in July 2011, Cuban media reported.

The project, which will involve laying two pairs of submarine cable over a distance of 5,340 kilometers (3,320 miles), will dramatically multiply Cuba’s connectivity capacity, the official news agency Prensa Latina reported Friday, citing officials on the communist-ruled island.

Deputy Informatics and Communications Minister Alberto Rodriguez said the cable “will strengthen national sovereignty and security” in keeping with the integration aims of the eight-member Bolivarian Alliance for the Americas, or ALBA, an international cooperation organization founded by Cuba and close ally Venezuela in 2004.

The cable will enable “greater quality in info-communication services” and create “more favorable conditions for confronting future developments,” Rodriguez said at the start of a business forum in Havana.
The main cable will link the northern Venezuelan city of La Guaira with the southeastern Cuban city of Santiago de Cuba – a distance of 1,552 kilometers (965 miles) – and have a 640-gigabyte-per-second capacity, while the other segment will connect Cuba and Jamaica.
Waldo Reboredo, vice president of Telecomunicaciones Gran Caribe S.A., the Cuban-Venezuelan joint venture that will operate the undersea cable, said the “shark-proof” cable will be financed with Venezuelan bank loans as well as the company’s own funds and have a lifespan of 25 years.
Reboredo added that the cable will allow the island to “multiply its current data, image and voice transmission speeds by 3,000,” reduce operation costs by 25 percent and could be extended in the future to Haiti, the Dominican Republic and the Lesser Antilles.

But he noted that these technological advances “will not imply an end” to Cuba’s current satellite-based Internet service, which he said is “all Havana is allowed due to U.S. hostility.” Cuban authorities accuse Washington of preventing the island from accessing the Internet via undersea cables, one of which connects Cancun, Mexico and Miami and passes just 32 kilometers (20 miles) northwest of Havana.
Cuba has had a satellite-based Internet link since 1996 that offers a 65-megabyte-per-second upload bandwidth and a 124 Mb/s download bandwidth; according to the Cuban government, any modification of the channel must be licensed by the U.S. Treasury Department.
Havana blames the United States’ decades-old economic embargo on Cuba for high costs, slow speeds and the fact that Internet service on the island is almost entirely restricted to companies and some professionals in fields such as health and culture.